Common Questions

Debt restructuring is the best solution for resolving your financial problems in the event that you are unable to pay your bills. Working for YOU and not the creditor, 4 Pillars negotiates the best possible restructuring scenario. We also find a way to cease harassing calls from creditors while your situation is being resolved. It is possible to arrange for protection from creditors during this process.

4 Pillars handles both individuals and families of all sizes who:

• Cannot meet their monthly minimum service payments of $10,000 or more of unsecured debt.
• Prefer to avoid bankruptcy.
• Have available cash flow to warrant a repayment schedule (at 0% interest) over a 36 to 48 month period.
• Would like to relieve stress, reduce debt and take control of their finances.

Anyone who finds themselves in the situation listed above is in a position for debt restructuring. If you'd like to get started, take our Free Assessment.

Different restructuring options have different effects on your credit rating. As a general rule any time you settle your debts at less than 100 cents on the dollar it will have a negative effect on your credit rating. 4 Pillars has the most comprehensive credit rebuilding program in Canada helping minimise the impact on your credit rating while building for future financial wealth.

We handle nearly every kind of debt imaginable, including credit card debt, bad loans, leases, mortgages and more.

The type of income a debtor receives does not limit the ability for debtors to carry out different restructuring options. In all cases, regardless of how a debtor feels, it's about looking at all of the options available and then having the debtor choose the option that they feel works best for them based on their current circumstances.

Making the decision to restructure can be a difficult one for some people. If you choose to deal with your debt and stop living paycheck to paycheck the trade off is you will most likely take a substantial hit on your credit rating. Choosing to restructure means you should consider all your options. One option for some to consider with good credit is to consider a consolidation loan but having a good credit rating doesn’t always mean you can access further credit or even qualify for a consolidation loan as you need to show the lender you can repay the debt. Before making a decision you need to look at your budget and figure out what is an affordable amount for you to repay each month without having to rely further on credit and how long will it take to pay off the debt.

The intention of restructuring is to establish a plan that creates financial stability and prepares you for a future without the burden of debt. We do not recommend using credit or pay-day loans if your intention is to go through debt restructuring plan as any financial transactions within 90 days of restructuring is considered a reviewable transaction.

This largely depends on the type of restructuring used. If you file into Bankruptcy, as a requirement of the Bankruptcy you must give up all forms of credit. If you have a credit card with a zero balance and you do not have other debts with this institution it would not be included in the debt restructuring plan and could possibly be free for use as a credit rebuilding tool after the restructuring has been completed.

As a general rule if you pay less than 100% of the balance owing to a creditor it will have a negative effect on your credit rating. In many cases it has been our experience that many debtors already have tarnished credit ratings before considering their options and seeking assistance to deal with their financial situation. There are 3 factors that affect the ability for someone to obtain a mortgage: credit rating, employment income, and the down payment. Most lending institutions use the Beacon Score to evaluate the debtors capability to obtain mortgages. Typically a Beacon Score of 650 or higher means a debtor can qualify without too many restrictions. After going through a restructuring program successful completion of the credit rebuilding program will bring home ownership closer.

If you do have a large loan that is secured against your house you should verify by obtaining a residential property search that can be conducted in every province in Canada. The fee is normally around $30 for such a service but it will list your residential home and any loans that are currently registered against if. If the loan is secure then it cannot be included. However, if you have debt arising from a shortfall after a property has been foreclosed we can help you deal with this.

If an individual debtor files for protection from their creditors in either a Bankruptcy or a Consumer Proposal then all the assets of the debtor and any joint assets must be listed in the documentation. In addition, for the purposes of preparing a Consumer Proposal the incomes of both the debtor and his or her spouse must be listed.

The spouse of a person who is in financial trouble does not have to be part of the process but certain aspects of their joint life must be disclosed as part of the process. This would include:

• All assets that are considered "joint assets" where both names appear
• Joint liabilities where both names are responsible for the debt
• The combined income of the family

In most cases the spouses name may appear on the documents but he or she would generally not be required to meet with the Trustee, creditors (if applicable) or attend any meetings. In addition, nothing would appear on his or her credit rating except the history of any joint debts affected by the restructuring. In some cases the spouse then becomes 100% financial responsible of the joint debt once the person in trouble has settled with his creditors but this depends on whom the creditors are.

A person cannot be held responsible for someone else's debt unless they have done the following:

1. Both parties have signed for the credit card as a co-applicant
2. The principle card holder has requested a supplement credit card for the spouse

If the spouse or common law partner does have a supplement credit card then we commonly use this questionnaire to determine if a supplement card holder is responsible for the debt:

1. Does the credit card statement come in one name or both names?
2. Does the spouse have a supplement credit card, if so, has it ever been used?
3. Did both people sign up for the credit card as co-applicants?

Obviously, the more times you answer "Yes" the more likely you are to be responsible for the debt. It is important to note that there are "no hard fast rules" as some creditors will pursue supplement credit card holders while other creditors will not. In many cases it is as important to know who the creditor is as the outcome of the questionnaire.

Certain Canada Revenue Agency debt (it must be either personal taxes or Director Liabilities) can be included in different restructuring options. Certain types of debts may not be included in restructuring but these are considered and reviewed on a case by case basis.

It depends on the age of the student loan. If it has been longer than 7 years since the last time you attended school then it is considered unsecured and therefore can be included. If the time is less than 7 years then it is protected by laws that protect the student loans from being included.

This will depend on what type of student loan you are planning to apply for and the severity of the type of restructuring you do.

Our fees are based on a couple of factors:

• Time involved working on your case
• Number and type of creditors involved in your case
• Severity of your financial situation
• The amount of money we can save you

We have successfully helped restructure the debts of over 8000 clients, with settlements averaging 25% of original debts owed. Most of our clients are honorable debtors who have chosen to show some restitution to creditors, thus avoiding bankruptcy.